Regarding the dividend yield on RAT, the following seems a reasonable position.
RAT is scheduled to pay 11.36c a year fully tax deferred.
Share price in recent days has dropped to 96c.
That's a yield of 11.83%.
RAT says their dividends are fully hedged at 87c for the next 6-8 years.
Assume that the $A and the USD go to parity - ie $A1 = USD1.
That last happened in about 1982.
The yield on RAT is not entirely determined by the conversion of USD into $A but is a factor.
Assuming the exchange rate is the sole factor, then even a 10% appreciation in the $A results in a 10% drop in dividends.
That is, the yield changes from 11.36c to 10.23c.
I say, whats really the big deal about that???
The yield would still be over 10% trading at 96c a share.
Thoughts? Opinions? Detractors?
dividend yield
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